Lufthansa chief executive Carsten Spohr has rejected the notion that his strategy of directing growth initiatives away from the mainline and towards budget unit Eurowings had a divisive effect among the group's staff.
Eurowings' expansion has been at the centre of a long-standing labour conflict with pilots and flight attendants that, over the past two years, has triggered the most extensive series of strikes in the Star Alliance carrier's history, though union negotiations are now being held.
Speaking in London yesterday, Spohr insisted that "these people [employees] love their job, even when they strike".
He adds: "They don't always agree what management tells them. That's fine, I accept that."
But Spohr suggests that a smooth return to normal operations after industrial action – something he describes as "probably very German" – is indicative of a workforce that fundamentally supports its employer.
"Within two hours after the strike, we were up on regularity of 99.8%," he says.
Nevertheless, Spohr argues that Lufthansa must leave behind pay structures that originate from a period when it was state-owned.
The carrier was fully privatised in 1997, the German government having reduced its shareholding to a minority stake three years earlier.
"If we want to maintain a leading role, we obviously need to change those [pay arrangements]," says Spohr, who argues that the existing cost bases prevent Lufthansa from growing its business "in the way we want".
He sees "price-sensitive" leisure traffic as a growth area in Europe's mature market. On the basis that concentration on traditional network airline operations alone will not sustain the group, Eurowings has been set up to capture that leisure traveller market.
Spohr acknowledges it is "difficult" for employees to accept cutbacks "at a time when you make record profits".
He admits: "I wish we had done it in a time when we had less profits." But he adds: "I do it now, rather than waiting even longer."
Management of legacy airlines must strike a "balance" between keeping historically-grown structures and responding to new market developments, Spohr asserts: "How much of your history, your heritage, your brand do you want [and] need to maintain, and how much change do you have to accept to maintain your ability to cope with the challenges of the future?"
Source: Cirium Dashboard
